Friday, August 31, 2007

Foreign Exchange Trading or simply FX or even forex describes the trading of different currencies of the world. The forex market is the largest in the world with trades amounting to more than USD 1.5trillion every day. Typically, most forex trading is speculative, with only a small part of the market activity representing governments' and companies' basic currency conversion needs.

The main centers for trading are Sydney, Tokyo, London, Frankfurt and New York. By virtues of it being a world market, it is a 24 hour market where online forex trading is conducted across the globe. This is a major advantage as it provides investors with a unique opportunity to react instantly to breaking news that is affecting the world markets. The forex market is known to have superior liquidity and thus there are buyers and sellers present perennially to trade in this market. The liquidity factor ensures price stability and narrow spreads and comes mainly from banks that provide liquidity to investors, companies, institutions and other currency market players.

Unlike the stock market foreign exchange trading is not conducted through a central exchange but something similar to the OTC (over the counter market). It uses sophisticated forex trading software recognized globally. The most commonly traded currencies are the EURUSD, USDJPY, USDCHF and GBPUSD. Trading in the forex market means the simultaneous buying/selling of a currency. The combination of two currencies being traded is called cross. Forex trading is done without commissions and thus proves to be a hugely attractive opportunity for investors dealing on a daily basis. Moreover, the forex market is dynamic, and there exists trading opportunities at all times no matter whether a currency is strengthening or weakening in relations to another currency.

The spot market is the largest forex market as it has the largest volume of foreign exchange currency trading. The market is called the spot market because trades are settled immediately. In practice, however, it takes two banking days. There are virtually no restrictions in the forex trading and the forex market thereby allowing you to enjoy trading opportunities during any market condition. If you are a commercial investor, you may need to swap your trade forward to a later date. This is called forward trading and can be undertaken on a daily basis or for a longer period of time. Although the forward trade is for a future date, the position can be closed at any time and the closing part of the position is then swapped forward to the same future value date.

Trading on margin means that you can buy and sell assets that represent more value than the capital in your account. Forex trading is usually conducted with relatively small margin deposits. Leveraging allows you to hold a position worth up to 100 times more than your margin. This is useful since it permits investors to exploit currency exchange rate fluctuations. However, without appropriate risk management high leverage can lead to both large losses and gains.

Spreads and Pips - The spread is the difference between the price that you can sell currency at and the price you can buy currency at. A pip is the smallest unit by which a cross price quote changes. This is shown when you compare the bid and the ask price, for example EURUSD is quoted at a bid price of 0.9876 and an ask price of 0.9879. The difference is USD 0.0003, which is equal to 3 pips.

Up until recently, the forex market, given its large minimum transaction sizes and-stringent financial requirements, was dominated by big professional players like banks, hedge funds, major currency dealers and the occasional high net-worth individuals. However, now several global companies are now offering small companies, traders and investors small transaction trades with the same price movements and rates.

Most people have this plan in life they work for a large (secure?) organisation, for 40 years or more, and then they feel that the organisation will repay their loyalty by providing them with quite a sizable top-up to their State pensions.

How wrong can they be?

Look at the chaos caused over the last few years on both sides of the Atlantic where companies have either illegally or by bankruptcy robbed hundreds of thousands of hard-working, loyal employees, their right to a comfortable retirement Murdock and Equitable Life in the UK; Enron, IBM and now Delphi in the States are just the tip of the iceberg. (Will GM be next?)

Then there is another highly relevant issue that of long term care. In the UK particularly, human rights for older people remains a very uncertain area, and unless you have money or very vociferous friends and relatives, you could become victim of bureaucratic activities. As reported in the Telegraph Money section in February this year, a couple who had lived together since the beginning of the Second World War ( 65 years of togetherness) found that when the husband had to go into a care home, his wife was refused permission to move in with him. Enforced divorce by the Welfare state? Luckily the couples family rallied to their rescue, and Gloucester County Council relented and the couple are now reunited.

What is the common theme in this reassurance that control of our twilight years will not be taken out of our hands by some faceless bureaucrat?

Financial insecurity of course.

In an attempt to overcome this uncertainty, many people are turning back to one of the bedrocks of financial security property.

But to many average people, the thought of investing in property is seen as a privilege that only the very rich and therefore those totally unaffected by the pension crisis can afford to indulge in.

However, many of these folk are already into property investment, and dont yet realise it. One thing most of us are brought up to believe is that we should, as soon as we are able, get a foot on the property ladder and buy our own house. But then it all goes a bit pear-shaped.

Most of us live in this house we have bought, usually with a really low cost, long term mortgage, and we then have this urgent desire to pay off the mortgage as quickly as we can, so when we retire, we can live rent-free in our own property. That is what we are taught to do in school, by our parents, by society in general.

Very commendable but what about our standard of living on retirement? Or our choice of care homes when the inevitable happens? We may have a nice house to live in, but if all of a sudden, we are only getting a fraction of our usual income, due to retirement or long term illness, what happens to the nice car, the good holidays, the freedom to go and see all the family when we want to?

Over the lifetime of the mortgage the average property - wherever it is situated, has been increasing in value by around 8% every year. With the average price of a house in the UK now at 150,000, that represents a growth of around 12,000 every year. After 10 years, that will amount to some 120,000 (about $205,000 to our US cousins), so you could have at your disposal a lot of this money by refinancing your house.

With the average deposit needed to buy another house as an investment in the UK being around 15%, and the average UK home costing 150,000, another house would require you to raise around 22,500 deposit, so in theory, you could go out and buy and 5 more houses using the equity in your existing house, and each house growing in equity by 8% (12,000 each per year), you would see your net worth grow by around 60,000 every year!

Thats all good and dandy, but now you have 5 extra mortgages of around 127,000 each, each one costing around 550 a month to service. This is what most people find is still the most daunting, and even terrifying prospect, of investing in property.

However, there are organisations around who specialise in locating property both in the UK and in places such as Spain where properties can be brought for very low amounts of money down, and for the uninitiated, full rental guarantees for up to 10 years can be provided in some cases. OK, there the trade off is that there would be little or no rental income, but the mortgage would be paid with no worries, and the capital growth after 5, 10, or more years would provide a very tidy capital nest egg indeed.

But and there is always a But where there is money to be made, sharks tend to circle, and before anybody rushes out and starts to buy low money down property, they should seek sound financial advice from an independent financial advisor.

Copyright 2006 Geoff Morris

Geoff Morris has built up a multi-million dollar property portfolio in less than 18 months. He has written a number of articles aimed to help others follow the same path to financial freedom. Imagine the peace of mind that you would achieve if you follow the advice to be found in his Free reports and consumer guides to be found at http://www.propertyprofits4you.com. If you want to take part in his latest Florida campaign this can be accessed at http://imnosey.com/dv.

State and local politicians at city hall write their bloated budgets based on the extra revenue assessments while property owners who realize they are about to be fleeced prepare their appeals. Engaging in a property tax appeal is one way to lower your tax burden, but more need to be done.

Retired taxpayers have lost their connection with the means to pay. Taxes based on a propertys estimated value is unfair and punitive. Too many taxpayers are becoming land poor in that their property value no longer is proportional to their income. Older person on a fixed incomes often have to sell their house to pay the taxes on it. Or, in other cases, sometimes feel trapped in old homes because their taxes would go up dramatically if they moved.

Property tax is a tax on capital. It should occur only on when you sell the home just like an individual stock in the stock market. One only pays taxes on the realized gain or loss for a stock when it is sold.

An annual property tax is the most regressive, destructive tax there is. It takes from rich and poor alike, irrespective of age, family status, health or income. Property values fluctuate and municipal taxes and budgets are never lowered, it seems. Rising property values have driven up taxes for all property owners. If property values decrease, does that mean taxes will go down?

Perhaps the ebb and flow gets resolved in the Wizard Of Oz but not in most US municipalities. Most governments are addicted to a tax and spend mentality and act like the characters in the Oz movie. The lion big show where the state develops its own pet private enterprise for the good of the community. The tin man no heart that ignores the plight of the average taxpayer, the elderly and retired perhaps throwing a few crumbs of tax relief their way but a deaf ear in they way of budget cuts and overall lower taxes. And lastly the straw man with no brains who over-hires and over-compensates their employees with benefits fit for kings and queens when they should be equal to Costco and Home Depot perks and employee policies.

Many homeowners who look on property as an investment, dont perceive the value of their property to be the price at which they purchased the property. They see it as the price for which they think (or hope) they could sell it for. Little do they remember the lessons from history. In the 1800s the stock market crashed and it took nearly 50-years for markets to recover. The 1929 crash took 25-years for markets and real estate values to recover.

Even the best intentioned investments can become wrong and long agonizing stretches can occur without an underlying asset regaining its former value. After the basics in Maslow's Hierarchy of Needs are met and your shelter transforms from the basics and takes on the shape of an investment, were beyond necessity and into speculation.

That brings up some interesting ethical questions. Should a basic shelter (like a trailer) not be taxed similar to milk, eggs and potatoes or is it an investment? Should speculations such as stocks and investment homes be not treated the same? If they are the same, should they not be treated tax-wise the same and taxed only on appreciation? Regressive property taxes make owning a home increasingly unaffordable.

You can triple the chances for winning your property tax appeal and also cut your prep time in half. I've been doing this for years. After countless appraisals and tax appeals I decided to make something affordable and useful for anyone deciding to appeal their taxes.

Both short term trading and long term trading can be effective trading strategies, however, long term trading has several significant advantages. These include the effect of compounding, the opportunity to earn from dividends, reduction of the impact of price fluctuations, the ability to make corrections in a more timely manner, less time spent monitoring stocks.

1. Compounding

Time can be investors best friend because it gives compounding time to work its magic. Compounding is the mathematical process where interest on your money in turn earns interest and is added to your principal.

2. Dividends

Holding a stock to take advantage of payouts from dividends is another way to increase the value of an investment. Some companies offer the ability to reinvest dividends with additional share purchases thereby increasing the overall value of your investment. Additionally, dividends are more a reflection of a company's overall business strategy and success than volatile price fluctuations based on market emotions.

3. Reduction Of The Impact Of Price Fluctuations

In the long term investment the persons is less affected by short term volatility. The market tends to address all factors that keep changing in the short term. So a person involved in long term investment or trading will not be affected as much by short term instability due to factors such as liquidity, fancy of a particular sector or stock which may make the price of a stock over or undervalued. In the long term, good stocks which may have been affected due to some other factors (in the short term) will give better than average returns.

Long-term investors, particularly those who invest in a diversified portfolio, can ride out down markets without dramatically affecting his or her ability to reach their goals.

4. Making Corrections

It is highly likely that you could achieve a constant return over a long period. The reality is that there will be times when your investments earn less and other times when you make a lot of money in short term. There may also be times when you lose money in short term but as you are in quality stocks and have long perspective of investment you will earn good returns over a period of time.

There are always times when some stocks do not perform and it is the wise choice to pull out of an investment. With a long term perspective based on quality stocks, it is easier to make decisions to change in a more timely manner without the urgency that accompanies short term and day trading strategies chasing volatile changes.

Investors that begin early and stay in the market have a much better chance of riding out the bad times and capitalizing on the periods when the market is rising by taking a longer term view using long term trading strategies.

understanding lot sizes in forex trading is very important to help you avoid the pitfalls of trading on a leveraged account. Forex trading involves the use of dramatically leveraged accounts and before you put one dime into a live forex account you need to understand how leverage works and what is happening in all the different sized lots. Also what is the optimal size lot to use when learning forex trading.

Let me talk to you a little about forex lot sizes. OK I am reaching with a play on words there but a lot of people who read my articles should know by now that I think forex trading should be fun and profitable.

normal Lot: Many forex brokers will require $10,000 to open an account and on it you can trade a normal lot size. There is usually a 1 lot minimum trade.The normal lot is worth $100,000 in currency and when you trade a lot it is 1:100 leverage. What this means is that you are getting a loan from the broker to control $100,000 for your $1,000. Now lets look at this leverage thing a bit more because so many people make a big deal about how wonderful forex trading is due to the leverage you can get. I completely agree that leverage is one of the many benefits of forex trading but it seems to me not many people properly understand the concept.

as an example you have a standard account with 1:100 leverage then for every 1 Pip you gain there is $10 in profit for you ( basically not factoring spreads commissions etc. ). Now leverage is a 2 way street and for every 1 pip the forex market moves against you then you lose $10 and this is what makes leverage fascinating to many. The fact is that you must understand both sides before getting into forex trading. Most markets swing up to 100+ pips a day easily and this means at 1:100 leverage you can in theory gain 100 pips in 1 day thus taking a $10,000 account to $11,000. Now for the bad news you can also lose 100 Pips on most markets and take $10,000 to $9,000 in a day just trading 1 lot. So when you hear people talking about 1:400 leverage they better be very accurate with their forex trading.

Mini Lots: Ok now lets look at a Mini lot and how leverage works with it. Most brokers require at least 1 mini lot to be traded. The mini lot is worth $10,000 this means you are trading with 1:40 Leverage. Let's do some math and I promise it want hurt much. $250 x 40 = $10,000 and since $10,000 is 1/10 of a standard forex lot this is why for every 1 Pip in your favor you earn $1 profit. Conversely for every 1 pip that moves against you forex trading you lose $1.

Micro lots: Now some brokers allow micro lots where you can do forex trading at 1:4 leverage again lets hit the math book a second. $250 x 4 = $1,000 which is 1 / 10 of a ($10,000) mini lot

and this means for every 1 pip in your favor forex trading you will make 10 cents profit and of course conversely for every 1 pip against you then you will lose 10 cents. I know to the novice this does not sound like much but if you had only $100 and traded an account with 1 micro lot then every 10 pips in your favor will mean 1% gain on your account. The micro is in my opinion a great size to trade when learning in a small account if your Broker allows this. Practicing forex trading with micro lots will give you room for forex market swings and time to develop your skills as a forex trader.

That is just a little about forex lots and I hope it clears some things up and explains some of the risk and rewards of forex trading.

For more information visit at http://www.digital-intuition.com and Download your free copy of forex flows the best forex trading software available using computerized A.I.

Yesterday we looked at 3 trading opportunities. Today, we are going to look at one shaping up in the euro currency, a possible profit opportunity and update the others. Lets take a look first at the euro. We are using the chart service futuresource.com and indicators RSI, Bollinger bands and stochastic in making our observations. This report is written at 10AM Central European time.

Euro The euro is in a firm up trend against the dollar and prices have recently retreated from contract highs. Prices are now at the middle of the Bollinger band and are looking to hold around this level. RSI has fallen back from overbought levels and stochastics are down, but oversold. Support lies at 1.34 and 1.32. Watch for stochastics to bottom and cross with bullish divergence to indicate a shift in momentum, accompanied by rising RSI. This looks like a correction in a bull market. Wait for the correction to run its course, by watching for the above indicators to give you a signal and shift the momentum back to the bulls.

Other trades we looked at yesterday were:

US V Canadian Dollar Same comments apply as before: We expect a bounce. RSI very oversold and the dollar is trying to hammer a bottom out above the key 1.10 level. Stochastics remain flat. If they cross with bullish divergence, expect a move up. A close below 1.10 means all bets are off.

US V Japanese Yen We expect the dollar to hold above the breakout point. Stops should be below the breakout if long if not, to go long look for stochastic to turn up with bullish divergence. The yen is the weak currency of the majors against the dollar and we would expect the dollar to hold its up trend.

Today, should give a clearer indication of near term direction. Short term momentum is down in the dollar. Watch the breakout point and stochastic momentum.

British Pound V US Dollar The trend in the pound is up but short term momentum is down. We expect the pound to move up after the recent correction, but need to see a shift in near term momentum.

Prices have broken the mid Bollinger band and are drifting lower. RSI is no longer over bought. Stochastic momentum is over sold and down. To enter a long trade watch for a cross in momentum on the stochastic with bullish divergence and also a rising RSI. With all trades dont predict wait for confirmation of shifts in near term momentum before attempting positions.

Good luck and good trading.

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You can see the claims on some FOREX web sites, implying that FOREX is a risk-free pastime. No investment is risk-free.

In FOREX you are trading substantial sums of money, and there is always a possibility that a trade will go against you. There are several trading tools that can minimize your risk, yes, but eliminate it, no. With caution, and above all education, the FOREX trader can learn how to trade profitably and minimize loss.

The Scams

FOREX scams were fairly common a few years ago. The industry has cleaned up considerably since then. Still, you should exercise caution before signing up with a FOREX broker by checking their background.

Reputable FOREX brokers will be associated with large financial institutions like banks or insurance companies, and they will be registered with the proper government agencies. In the United States, brokers should be registered with the Commodities Futures Trading Commission or a member of the National Futures Association. You can also check with your local Consumer Protection Bureau and the Better Business Bureau.

The Risks

Assuming you are dealing with a reputable broker, there are still risks to FOREX trading. Transactions are subject to unexpected rate changes, volatile markets and political events.

Exchange Rate Risk: refers to the fluctuations in currency prices over a trading period. Prices can fall rapidly, resulting in substantial losses unless stop loss orders are used (see below).

Interest Rate Risk: can result from discrepancies between the interest rates in the 2 countries represented by the currency pair in a FOREX quote. This discrepancy can result in variations from the expected profit or loss of a particular FOREX transaction.

Credit Risk: is the possibility that 1 party in a FOREX transaction may not honor their debt when the deal is closed. This may happen when a bank or financial institution declares insolvency. Credit risk can be minimized by dealing on regulated exchanges, which require members to be monitored for credit worthiness.

Country Risk: is associated with governments that may become involved in foreign exchange markets by limiting the flow of currency. There is more country risk associated with "exotic" currencies than with major countries that allow the free trading of their currency.

Limiting Your Risk

FOREX trading can be risky, but there are ways to limit risk and financial exposure. Every trader should have a trading strategy; i.e., knowing when to enter and exit the market, and what kind of movements to expect. Developing strategies requires education, which is the key to limiting risk. At all times follow the basic rule: Never use money that you cannot afford to lose.

Every FOREX trader needs to know at least the basics about technical analysis and how to read financial charts. He should study chart movements and indicators and understand how charts are interpreted. There is a vast amount of information on FOREX trading available both on the Internet and in print. If you want to be successful at FOREX, then educate yourself.

Stop-Loss Orders

Even the most knowledgeable traders, however, can't predict with absolute certainty how the market will behave. For this reason, every FOREX transaction should take advantage of available tools designed to minimize loss.

Stop-loss orders are the most common way to minimizing risk. A stop-loss order contains instructions to exit your position if the price reaches a certain point. If you take a long position (expecting the price to rise) you would place a stop loss order below the current market price. If you take a short position (expecting the price to fall) you would place a stop loss order above the current market price.

Stop loss orders can be used in conjunction with limit orders to automate FOREX trading. Limit orders specify that an open position should be closed at a specified profit target.

Ron King is a full-time researcher, writer, and web developer. Visit FOREX4U to learn more about this fascinating trading vehicle.

Since the US dollar is the centerpiece of the market, it is normally considered the 'base' currency for quotes. In the "Majors", this includes USD/JPY, USD/CHF and USD/CAD. For these currencies and many others, quotes are expressed as a unit of $1 USD per the second currency quoted in the pair. For example, a quote of USD/JPY 123.50 means that one U.S. dollar is equal to 123.50 Japanese yen.

When the U.S. dollar is the base unit and a currency quote goes up, it means the dollar has appreciated in value and the other currency has weakened. If the USD/JPY quote listed above were to increase to 124.01, that would mean that the dollar is stronger because it will now buy more yen than before.

Some exceptions to this rule are the British pound (GBP), the Australian dollar (AUD) and the Euro (EUR). In these cases, you might see a quote such as GBP/USD 1.4366, which means that one British pound equals 1.4366 U.S. dollars. In these three currency pairs, where the U.S. dollar is not the base rate, a rising quote means a weakening dollar, as it now takes more U.S. dollars to equal one pound, euro or Australian dollar.

So if a currency quote goes higher, that increases the value of the base currency. A lower quote means the base currency is weakening. Currency pairs that do not involve the U.S. dollar are called cross currencies, but the premise is the same. For example, a quote of EUR/JPY 127.95 signifies that one Euro is equal to 127.95 Japanese yen.

Chuck Cox is a Technical Writer and Industrial Scientist by professional with a background in statistics. He has used mathematical and statistical methods to invest and trade in the stock, futures, and options markets. Chuck has owned various businesses and presently operates several websites. To investigate a new business idea, visit his website, http://www.earncashathometoday.com/trading-FOREX.htm

The Appliance & Tools industry is a relatively small group of companies which commands a lot of demand from other organizations. Large-cap leaders such as Black & Decker and Whirlpool produce common products not only for large corporations, but for the retail consumer as well. While both these companies are relatively well-known, there are some other smaller, mid-cap corporations, such as Pentair and Jarden which also do quite well relative to fundamental performance. One mid-cap equity in particular, The Stanley Works (SWK), not only engenders solid growth for shareholders, but controls an excellent business model which creates increasing margin growth and an undervalued stock.

Before looking at the relative oversold nature of The Stanley Works it is vital to understand what the company produces. According to Reuters, "is a worldwide producer of tools for professional, industrial and consumer use and security products." Separating the business into three segments, "Consumer Products, Industrial Tools and Security Solutions," Stanley diversifies its company to hedge against risk-adverse demand fluctuations in any one industry. Consumer Products include production for "planes, hammers, and demolition tools", as well as "wrenches, sockets, and metal tool boxes" sold to retailers and third-parties. Similarly distributed, the Industrial Tools segment, sells "plumbing, heating, air conditioning and roofing tools" such as "pipe wrenches, pliers, press fitting tools and tubing cutters" both to third-parties and directly to the consumer. The last segment, Security Solutions, provides, "automatic doors, door locking systems, commercial hardware and integrates security access control systems"a comparable but different approach to business when compared to the other two regions of production.

While there are some notable differences between each of the three areas, some investors may argue that the general business model is fairly consistent throughout each segment, and because there are current problems related to the housing and manufacturing sector, it may not be a suitable time to invest in companies like The Stanley Works. However, there are two important reasons to not get discouraged by this observation. First, if technical analysis is correct, steel prices (a big commodity for Stanley) should come down in the next few months. Since January of 2005, when metallics on the CRU Steel Price Index were at 150, prices have escalated to a current reading of near 220. However, during this entire duration, the trend almost perfectly resembled an Elliot Wave to the upside. Now as the wave is near the peak, the correction should begin with an ABC pattern back to a familiar Fibonacci support level. If this does happen, lower steel prices would mean lower commodity prices for Stanley to paycontributing to higher operating and gross margins. In addition, to answer the question about a weak housing and manufacturing sector, Stanley, share price wise, has performed quite nicely. Even though much of this company's business is found with the slumping areas of the economy, in 2007 Stanley's share price has appreciated nearly 26%a number almost doubled of the S&P 500. In addition, Stanley has not had a negative calendar-year performance since 2002, and has only declined twice year-to-year in the past ten years. If Stanley can perform this well under such adverse conditions, there is absolutely some great potential for further share price growth.

Now while these models are great to examine and make speculations about, it is also important to understand how Stanley has performed and will perform relative to financial figures. Looking at the top-line over the past twelve months for this company and investors will see a $4.01 billion dollar number. Compared to the other top 15 market-cap leaders of this industry, Stanley places third in year-to-year growth. What is surprising, however, is how such a high sales figure still gives way for strong margin growth. According to Reuters, during the past twelve months, Stanley saw gross margins at 37.01% and operating margins at 9.93%. Comparing these numbers to five year respective averages of 35.56% and 9.29%, and an investor will realize that margin growth, despite high revenue, continues to grow. What makes these numbers even more intriguing is that the industry not only has smaller trailing respective figures at 28.86% and 7.69%, but each of these numbers are below the five year margin average as well. Even more specific to market-cap competitors, Black & Decker, albeit it has higher revenue than Stanley, has seen gross margins at 34.77% from its five year average of 35.69%. Another industry competitor, Jarden, is a similar story with a respective drop in gross margins from 26.74% to 24.72% and a drop in operating margins from 8.08% to 7.54%both coming at a revenue collection 5% lower than Stanley's trailing figure. Therefore, not only does Stanley have growing margins when the industry has decreasing gaps, Stanley is doing so with the third highest revenue production in the industry.

Furthermore, grow is also illustrated over the past year relative to sales and EPS numbers as well. Sales has grown at 18.92% from last year compared to the industry's respective growth of 14.51%, and EPS trailing growth at 33.71% is also quite high when looking at the industry's EPS difference of only 9.91%, according to Reuters. None of the market-cap industry competitors of Black & Decker, Jarden or Pentair can compete with these figures, despite lower revenue numbers, and only Jarden has a higher EPS difference than a year ago when compared to Stanley. What also separates Stanley from the other three companies is capital spending. Although a bit smaller than the industry average, Stanley still has a capital spending rate of 1.95%. This number is positive which not is the case for Pentair or Black & Decker. This is also illustrated with cash flow that is above free cash flow. Spending on CAPX now will allow for larger EBITDA figures latermore cash for buybacks or other incentives to lure investors. Overall, Stanley has put itself in a great position growth-wise and should continue to excel in both the short and long term with these figures.

What really separates Stanley, however, is its fundamentals when used against its share price. The forward P/E ratio of 15.95 for 2007, while not significant, is still lower than the industry trailing average of 19.00. In addition, this number is also quite similar to competitor Jarden and is below Pentair's 19.65 multiple. More specific to sales, Stanley has a reasonable price to sales figure of 1.24 which is in very close range of all three aforementioned industrial competitors. Forward enterprise value to revenue at 1.52 is respectable and continued cash growth from less CAPX spending in the future should contribute to lower multiple valuations and other discounted comparisons as well. Combining growth to value with the PEG ratio at 1.40 for Stanley, the number is below both Black & Decker at 1.91 and Pentair at 1.71. This number illustrates that Stanley is not only growing well, but is undervalued relative to this growth.

Respective to other intangibles, Stanley Works has performed quite well in these areas. CEO John F. Lundgren and his 17,600 employees headquarter in New Britain, Connecticut has managed to take advantage of investments and equity. All of ROA (7.58%), ROI (10.90%), and ROE (22.11%) are above not only the company's five year average, but above industry figures as well. The company is solvent with a most recent quarter current ratio of 1.34 and long term and total debt is also under control when compared to equity. Inventory, asset, and receivable turnover are all quite high compared to other competitors as well. Overall, Stanley Works is very susceptible to strong growth both in the short and long term with the current fundamental analysis.

Therefore, business strategy and fundamental analysis illustrate that Stanley Works is a profitable company which can be a great investment for any portfolio. Relative to technical analysis, while the RSI at 60 and a parabolic SAR below current share price may not look to enticing for the short-term investor, as a long-term investment, Stanley Works has the strong historical fundamental background and brand recognition to continue to help investors report strong capital gains for portfolios.

Dennis Biray presents advice on all kinds of topics ranging from finance and investing to fitness to sports. For more information email him at dbiray@gmail.com, or to view other articles written by him visit http://www.biraynetworks.co.nr

Stock option trading presents the opportunity to potentially make a fortune trading options than almost any other form of online trading in todays market. The level of reduced risk combined with above average leverage allows a skilled option trader the chance to make sizable gains but an aspiring option trader must have a solid understanding about what creates a reliable option trading method to insure long term success at option trading. There are five fundamental steps that any option trader must implement when creating a superior stock option system.

To begin with you must realize the affects of time on the premium of the option you are choosing to trade. There are two parts you must factor when considering time into the stock option trading process. The first part that has to be considered is the time left on an option till expiration. Since stock options have a defined time period of anywhere from 30 days up to three years in some cases then you must be sure to select the proper stock option with enough time on it in order to profit. You must be sure that you purchase the correct option containing enough time on it to insure that time decay doesnt erode your investment away before your position has enough time to be profitable.

This brings us to the second part of the option selection process of trading options successfully is factoring time into your trading system. Trading a particular stock option and knowing the key factors of your option trading system or setup by knowing the average time period of a trade once it has been signaled and entered. For example, if your average holding time for an option trade is five days then you dont want to buy an option with four months of time premium left on it because you would be paying more for the extra time with the options purchase price. Nor would you buy an option with less than 30 days till expiration as time decay would eat away the value of option so rapidly that even if the stock options underlying stock moved favorably in your direction the time decay would be so great you would be too late to capture a gain in the option itself.

The third step to successful stock option trading is comprehending the relationship of volatility between the market, the underlying instrument that the option is based on, and the effect is has on the cost of the option itself. When the stock market as a whole as an index goes thru periods of low volatility or experiences low trading volume then the stocks that make up the market tend to follow general market and also begin to follow suit with periods of low volatility which cause cause the value of stock options to become cheap. However if the general markets volatility begins to spike it causes individual stock option premiums to increase in value as long as the market moves in the traders favor.

The fourth key in successful stock option trading is having a trading method that takes factor these key steps into giving clear entry signals, clear exit signals, a defined system of trade management, and a profit factor greater than your average loss over a series of trades. Understanding all steps of various trade setups is meaningless if you dont have a trading system that guides you through each step of the trade management process. A solid trading stock option system guides you by the hand and details each step while guiding you towards being a consistent winning trader in the markets and being profitable in the end.

The fifth and final step to trading stock options successfully is trading psychology. Traders and there mental makeup are usually complex so it is very important that stock option traders have a sound stock option trading system or method that factors this into their overall approach to trading the markets as well as the discipline to follow their trading methods. You can give two traders the same exact profitable trading system but its very likely that they will experience very different results. The reason for this is usually is because the one that has the ability to remain as detached from his losing trades as well as his winning trades while maintaining the discipline to follow the systems rules no matter the individual trading result will come thru as the most profitable trader in the end which shows us that it comes down to a superior mental process towards trading the markets.

Using these five steps as a foundation to create your own stock option trading system can help you avoid the mistakes of many other stock and option traders. By understanding time decay, factoring an options time into your trading method, how volatility impacts a stock options intrinsic value, what details a winning stock option trading system, and your own trading psychology you now have a the key steps to build your trading career on.

E-currency trading is growing into a worldwide business. If you are looking for a growing business that will never let down E-currency is a great one. Dxinone is a very confusing system for a person that has never seen or used it before. If you have no idea how to sign up or start to fund your account you will miss out on a very good way of making money-using e-currency.

The web page they use offers no guide to helping you start using the Dxinone system. There are however VERY helpful guides that you can buy for a small price that teach you everything you need to know about Dxinone, and how to get start in e-currency.

Once you join Dxinone and make an account you can then fund your account with money using NetPay, E-gold, E-bullion, and a few others. Once you have funds in your account you can then start to make money in the e-currency system. You will buy digots with the funds in your account. These digots act like a share of stock would. A window will open in Dxinone, and you will see a list of places you can buy digots from. These digots will be how you are going to profit from the e-currency system.

Once you have used all the money in your dxinone account you now will see how the system works. Each night you can log into dxinone, and check up on your digots to see how much you made in profit. Everyone has a different way for buying his or her digots. Again buying and selling digots is just like buying and selling stock. You will see under your TDV Total digot value how much profit you have. You can also tell how much money you used, and how much you can take out of dxinone. Each night you will gain any where from .35% to .5% in returns as profits. The nice thing about dxinone is that your money is compounded daily unlike other investments that might only compound weekly or even monthly. Each night you are making money with e-currency.

As you can see it can be very hard for someone to learn how to use or even start with Dxinone. This is a system that everyone should get to know, as it is a very profitable way of making money online with e-currency exchange.

I used the mazu guide to help me get started in Dxinone. It also helped me take my $400 investment into Dxinone and turn it into $5,100 in 4 months. Visht Mazu E-currency Online to see how the mazu guide can help you.

Thursday, August 30, 2007

There are some forex blogs out there that you can learn a lot from. One of them is Baby Pips. This is a very active blog with postings by several experienced, successful forex traders every day or two. This blog gives the actual trades they are making at the time, and explains the reasoning behind them. There's also a lot of learning tutorials that you can read here. It's also funny and easy to understand.

Another good forex blog is Adam Kritzer's Forex Blog. He is considered a guru of forex investing. His website is updated regularly, with a lot of good investing ideas, currency trading news and analysis. His blog started in 2004, so you know he has been actively trading, probably successfully, during all that time.

A third very good and interesting trading blog is Grace Cheng's Blog. Grace has been trading professionally now for several years, and she paper traded for a long time before that. Her site also has a lot of interesting articles that you can read that were written by her, and in her blog she often tells what she is doing at the time. If you're a forex trader or planning to become one I would keep up on these three blogs, because they're updated regularly, have a lot of good information and articles, and are published by active, experienced, and successful traders. Here are the links to these three great forex trading blogs:

---------------------------------------------------------------- Roger Bovee is the editor and publisher of Forex Trading Machine Blog. Go there to read the GBP/USD mechanical trading system that can make an average 70 pips profit a trade, a $39 value, by 11 year forex trading professional Avi Frister! http://forex-trading-machine-blog.blogspot.com ----------------------------------------------------------------

Many people today are rushing to get started in the investment game by opening online trading accounts with the largest brokers in the USA today. However, many people are also losing money each day due to either a lack of trading knowledge or merely having the gambling mindset when doing online trading.

This article highlights there essential strategies that you need to know in order to make more money from online trading.

1.Understand market trends Regardless of whether you are trading commodities, forex or stocks online, you need to have a basic understanding of market trends. Financial analysts generally categorize this knowledge as fundamental analysis which deals with general factors and trends concerning the instrument and technical analysis which is an indicator of market psychology. Regardless of whatever your inclinations are, spending some time reading about these two contrasting theories will help you understand what direction the market is moving and to make money from online trading.

2.Set stop losses One advantage of most internet trading platforms is that you can set stop losses on any trade that you do so once the share price drops below a certain level, the trading system will sell your stock for you. There are two kinds of stop losses normally and they are the trailing stop loss and the fixed stop loss. The trailing stop loss is the one that you should pay special attention to. Always focus on protecting your downside and your upside profits will be protected. Stop losses are therefore essential if you want to ensure that your profits are locked in. Remember that for stop losses to work real well, you need liquidity in that instrument as even if you have a stop loss and the market is not liquid, you would not be able to exit fast enough to avoid a loss. Making money with Online trading in this respect is the ability to cover your downside potential so as to retain your earnings.

3.Devise fast and effective online trading strategies Most people today doing online trading are not day traders with huge amounts of time daily, nor people with huge amounts of money so they are hard pressed for time and yes they have to work unlike some people. Therefore the key to success in online trading is to either devise fast and successful trading strategies or spend time reading or attending a course. You want a trading strategy that works time and time again and that takes little time to evaluate and execute. Imagine the irony today, people are paralysed with information overload and remain unable to trade quickly and efficiently daily without spending either lots of time or losing lots of money.

Spend some time today working on learning all you can to succeed with online trading and you will start making money online with your trading platform.

Copyright 2006 Joel Teo. All rights reserved. (You may publish this article in its entirety with the following author's information with live links only.)

Joel Teo writes on various financial topics relating to Ahwatukee Real Estate Investment. Signup for his free online Real Estate Investing newsletter today and gain access to the Six Day Real Estate Investment Profits Course now at www.realestateinvestment101.info/Ahwatukee.html

If you are thinking of trading FOREX then you need to consider the fact 95% of traders lose their equity quickly.

FOREX trading is difficult as it means you have think and act in a totally different way and adopt a different mindset to win.

Here we will outline some of the mistakes novice traders make in adopting the right mindset.

1. Hard work does not guarantee success

In most professions the more you put in the more you get out.

In FOREX trading however this is simply not true, you dont go paid for effort, you get your reward for making winning trades.

Many people say knowledge is power

In FOREX trading the right knowledge is power and this does not mean working hard.

2. Systems have to be complicated

Nothing could be further from the truth.

In todays world of technological advances that astound us each day, it is tempting to think that we can conquer the markets with science, but trading remains simple.

Simple systems can and do work best, as they are more robust in the face of ever changing brutal market conditions.

Dont make the mistake of complicating your system.

3. Leave your ego behind

Most people have an ego and none of us want to look stupid, but if you trade you need to accept the market will make you look stupid on numerous occasions.

Be prepared to look and feel stupid, as the market does this to everyone.

4. Taking loses

Related to the above, people hate taking a small loss, after all if they leave it will turn around and they don't want to look stupid.

In a leveraged market this ends in disaster.

A small lose becomes a big loss, then reaches a stage where a trader faces wipe out and has to take it.

5. You need to have the courage to make big profits.

Surely we all want big gains?

We all do, but:

Most novice traders lack the courage to make big profits..

As soon as they get a profit they get excited and want to take it before it gets away, the bigger it gets the more tempted they get to bank their profit.

Add in the fact, that there are retracements into open equity that play havoc with emtotions when open equity is eaten into and the result is a trader will bank a profit of a couple of thousand and be happy.

If they had the courage of their conviction, in many instances they could make 10, 20,000 or more, by staying with the trade.

Currencies trend for months or years and if you have the courage to trade the major trends you can make huge profits, but you need to follow them.

6. Someone else can give me success

This is the biggest mistake in FOREX Trading and is rooted firmly in human nature.

We feel safe in groups and we are used to consulting an expert on a whole manner of things in life.

In FOREX Trading this is a bad move.

You need to know what you are doing and have total confidence in your own ability, without outside inputs.

Buying an e-book for $100 or so, is not going to make you a winner, neither is agreeing with the majority of so called experts in the media.

Firstly, no one can give you success it has to come from within and you will only be successful if you are confident in something you know will work for you.

Furthermore, the majority are wrong, so why follow them?

Trade in isolation, its not a normal human trait but one that is critical for success in online FOREX trading.

Trading can be lonely, make you look stupid and play havoc with your emotions, but if you can adopt the right mindset, you can and will succeed and the best part is:

Forex charting software can show you just how you are spending your time and money. You do not want to be wasting either. If you are going to become a forex trader, you need the tools the pros use. The charts that the software will provide will give you wonderful insight into the different aspects of the forex market. You will be able to study the behaviors of the market over longer periods and thus, be able to analyze how these behaviors affect forex trading.

Forex charts will allow you to be more informed in regards to various patterns and trends. Thus, allowing the investor to make careful, informed and weighted decisions based on the analysis provided by the forex trading software. As an investor, you want to make a decision that is not rushed.

Forex charting software goes through historical and current information to help predict future trends in forex trading. This gives the trader that uses charting software an edge in trading.

Forex charting software has the ability to analyze prices based on the combinations of open, low, high or close points that are taken and placed on the chart over a particular period of time.

You must make sure your charts are up to date and accurate. They must be meaningful and provide significant information and must integrate with the trading platform the forex trader uses.

Using forex charting software can be an invaluable tool when trading on the forex market. When the investor is properly prepared and they have done diligent research, you can find the right options in charting to suit your investing needs. This than can make forex charting software the answer to many problems you may experience in trading, and instead make your profits increase dramatically. Here are some factors to keep in mind when looking for forex charting software:

is the software user friendly are the charts easy to follow will you be able to customize charts to fit your needs will you be able to save your customized charts can the software be easily programmed

Make sure that the forex charting software can do everything that you need to do to trade in the forex market.

Several scenarios make a great decline of currency value like political uncertainties, unemployment that leads to higher inflation, other relevant issues that can hamper commerce and business from functioning well, and other macro-economic situations. This simply means you make decisions to buy or sell but dont put any real money down. The official currency of the European Union (EU), the Euro, was launched in 1999 with coins and banknotes issued in 2002.

This World recession effectively killed any growth in FX speculation as disposable income was at a premium. When people or companies hold foreign assets, there is an extra source of possible gain or loss, over and above the rate of interest or rate of profit earned by the asset itself.

If Denars are rare - their price will remain high in DM terms, i.e. But a strong currency (the Denar, in this case) is not always a positive thing. This World recession effectively killed any growth in FX speculation as disposable income was at a premium. Euro is a floating exchange rate, therefore market demand and supply controls the value of the currency.

Placing a foreign exchange hedge can help to manage this foreign exchange rate risk. At the end of WWI there was a brief period of massive currency speculation.

Stock trading is similar to owning part of a company or organization. It is often wise for the beginner to dabble in stocks trading before looking at Forex trading. If its people have the most employment, there are more needs for commodities and supplies that businesses are revolving as well as it use of money. All other currencies were pegged to the dollar at a certain rate.

Investors used to invest domestically mainly, but with the Euro introduction more investors are now attracted to euro areas. The exchange rate refers to the value of the US dollar against the values of currencies of other countries. It is an excellent way to get your feet wet without a whole lot of risk. If the US INFLATION rate is HIGHER, investors are LESS likely to prefer the US -even with higher interest rates- because of the expectation that the value of the dollar will be ERODED by inflation.

This has benefited the poorer member states which had weaker currencies previously for example Portugal, before the euro the Portuguese escudo was not that popular outside its own country or a particularly strong currency but now since Portugal is part of the EU its markets are much more attractive to other EU and non EU countries. Their lenders will also be afraid to lend them money, because these lenders cannot be sure that the borrowers will have the necessary additional Denars to pay back the credits in case of such a devaluation. If Forex exchange rate in our terms is equal to 100 yen to the dollar, the inverse would be $0,01 (one cent) per yen. One important way of encouraging people (and firms are made of people) to do things - is to allay their fears.

If you want to make big profits, then you should know that the best way is do it for yourself - and not rely on others.

Any trader (even a novice) can build a successful FOREX trading system - and this article shows you how to build a profitable system in five simple steps.

What Makes a Successful FOREX Trading System?

Successful trading systems have three main characteristics:

1. They are Simple

Forget complicated systems with lots of rules - its a proven fact that simple systems work better - and are less likely to fail, in the brutal world of trading.

2. They Run Profits and Cut Losses

You need to have a longer term FOREX trading system that milks the big trends for profit, and cuts losses quickly.

3. They Follow Long Term Trends

There is no point in trading for small profits - i.e. day trading, as you will never cover your inevitable loses with small profits.

Focus on long-term trends - its these that yield the big profits, as they can last for years.

Now lets get down to the five steps of building a FOREX Trading System:

1. Your Method

We have said to keep it simple, and this is exactly what you should do - just a few rules, and a robust money management system.

2. Spotting Opportunities

Look for the long-term weekly trends, and then move to daily charts to time entry. When we say long-term trends, we mean months, or years - NOT just a week or two.

3. The Best Way to Trade Currencies is via a Breakout Method.

Breakouts occur in all currency markets all the time - so base your system on a trend following breakout system.

There isnt space here to describe exactly what a breakout system is, but we have articles on breakouts posted on our web site.

Its a fact that most of the worlds billionaire traders use breakout systems in their trading - and you should use a breakout system as well.

4. Timing Entry

The best way to time an entry is to watch for a break on the chart, confirmed by stochastics crossing with bullish or bearish divergence this is a great timing tool.

When you are in strongly trending markets, you can also use Bollinger bands, to time your entries - and take profits.

The Bollinger band is a great filter indicator, and all traders should consider it.

5. Money Management

If you are following a breakout method, either the trade runs quickly in your favor - or the break is false and quickly reverses.

Dont put your stop just below the breakout point! - If the trade does not follow through within the day, exit the market, and use a monetary stop in the day session.

A Simple F0REX Trading System for Profit

With the above system, you will focus on the longer-term trends - and milk them for maximum profit.

You will also not trade frequently, and you will liquidate losers quickly.

We dont have space here to go through how to use the indicators, but with a bit of research and testing you will see why a FOREX trading system built on the above principles, will work, and will continue to work.

The system will give you a lot more profit than the so called predictive, over hyped complicated systems, sold by vendors and gurus these systems only work in back testing.

Build yourself a FOREX trading system - and see for yourself, just how profitable they can be!

Wednesday, August 29, 2007

An expert advisor is a piece of software which works as a plug-in for your trading platform. The purpose of an expert advisor is to automate your own (or someone else's) trading system.

An expert advisor works by monitoring any market for you 24 hours a day, looking to place trades for you once it sees that certain parameters (based on your own, or someone else trading strategy) have been met.

To build your own expert advisor, you need to have a working knowledge of the MetaQuotes Language 4 (MQL4) which is the built-in language for programming trading strategies. There are companies which will (for a fee) automate your trading strategy and build an expert advisor for you based on your own settings. There are also companies which will sell you their own expert advisors.

Most forex expert advisors are developed for the Metatrader trading platform. Developed by Russian programmers, Metatrader had become the standard trading platform for many professional traders and forex brokers.

Once you have built your own expert advisor (usually a file ending in .EX4) or purchased someone elses, the process of setting it up with Metatrader 4 is quite simple. It is just a matter of opening and installing the file into your MT4 platform.

ADVANTAGES OF EXPERT ADVISORS:

The main advantages of trading with an expert advisor are:

1. The expert advisor has a plan. It sticks to this plan and the settings you have developed into it no matter how uncertain the market looks or how you may feel about the market at a particular point of time.

2. The expert advisor is consistent. It can eliminate the negative human aspects of trading which include fear, greed and inconsistency in trading.

3. The expert advisor frees you up from physically having to watch and analyse the charts to find a signal to enter/exit trades. It does this automatically for you so you don't have to sit in front of your computer all day.

4. Freeing you up from watching charts for entry and exit signals also has the added benefit of giving you more time to spend on actually developing your trading strategies, doing back tests and more and more tests.

5. Finally, the expert advisor (or forex robot) can monitor many markets at once, giving you access to many more trading opportunities than you can physically find and analyse by yourself.

DISADVANTAGES OF EXPERT ADVISORS:

1. The robot (expert advisor) does not and will never have the feel for the human and the soft non-programmable issues. The trader must always look at the bigger picture, the fundamentals as well as the hundreds of other important issues which affect the ebb and flow of the forex market.

2. Many traders also choose to use expert advisors for the wrong reason. They believe that simply by trading with a robot they will automatically have better results or be better traders. Essentially, all an expert advisor will help you with is with trading consistency. It will just free up your time to focus on developing and testing your trading strategies instead of physically having to look for and execute trading opportunities.

by Giselle Sanchez - Learn more about building your own expert advisor, how to set up an expert advisor with Metatrader 4 and choose from over 40 of the best forex expert advisors.

Money is tight and youre desperate for an extra pair of hands, but you dont have a budget. This is also known as, I have no one to delegate to, so now what? Dont despair, there are several no cost ways to increase your productivity and find ways to delegate. Even if you do have a budget, these tips will enhance your budget and help you get more out of your delegating dollar.

Here are 8 ways to get low cost and free services.

Tip #1: Tune up your computer Is your computer in need of a tune up? Are you constantly crashing? Are you rebooting? Its not only frustrating, but it kills an enormous about of time. Not to mention the information you lose. If your computer crashes and you reboot each time, how long does it take for your computer to reboot? I can guarantee if there is something wrong with your computer that is causing it to crash, then it doesnt reboot quickly. How frustrating is that for you and how much time is that wasting? Get it fixed. Buy something new, but dont avoid the problem. Time is money and thats money you could be spending bringing in some help to do something else. If you have a problem, talk to your computers manufacturer. Some computer companies like Compaq will even send you a loaner computer if you need to send yours away to be fixed. This is specifically for purchases on business computers, so if you bought your laptop at Costco, you might not have this service. Its worth a phone call to find out. To quote my Grandpa Lenny, If you dont ask, you dont get.

Ready to throw in the towel and buy something new, check out www.techbargains.com.

Tip #2: Trade Services Is there something specific that you need? Maybe there is a special skill you need like copywriting, bookkeeping, internet help, etc. Find an expert who is in a similar business position and see if you can trade services.

Tip #3: Who Do You Know that Will Work For Free? Do you have friends and family that could help you out? Would your spouse, partner, parents, kids, and/or friends be willing to give you an hour, two or more to help you out? Think back to the days when you had to move. All of your friends gathered around to help you pack and lug boxes, all for the price of a couple of pizzas. Just replace the packing and heavy lifting with business items and tasks.

Tip #4: Ask for Volunteers In addition to friends and family, if you have an event coming up or a big project that you need help with, go to your mailing list and see if someone would volunteer. I get requests all the time to volunteer at seminars, trade shows and other events. People love to help out. You can return the volunteer favor for them down the line.

Here are a few other things you could offer: Email your mailing list about their services. Send some referral business without taking a referral fee. Give them a free ticket or a copy of the items they are working on for you.

Tip #5: Buddy Up You know what they say, two heads are better than one. Find a friend or colleague who also needs some help and create a buddy schedule. She works with you for a few hours a week; you work with her for a few hours a week. This is different from trading in that you are creating a long term relationship and regular schedule as opposed to a one-off project.

Tip #6: Use Delivery Services Its a web world that we live in. Many business related companies are online and will ship to you. Instead of having to run to: Office supply stores like Office Depot or Staples; To a warehouse store like Costco or Sams Club; or To a printer like FedEx Kinkos, place your order online and have it shipped to you. Many places wont even charge you a shipping fee if you spend their minimum amount. How much time in running around would that save? And you can do it on your own schedule.

Tip #7: Use Personal Services Again, time is money. If you are spending an entire day running to the cleaners, the market, cleaning the house, doing the laundry, etc., then you are using time that could be spent cultivating new clients, creating new programs, going to networking meetings, etc. Look into using services such as a house keeper, fluff and fold for your laundry or calling in a meal delivery service. Yes, this will cost a few dollars. Although, if you use that saved time to make follow-up calls that result in a new client, wouldnt it be worth it? Im not saying go out and live beyond your means with all kinds of fancy services. This only works if you take that saved time to perform revenue earning tasks, so be sure to use your time wisely.

Tip #8: Get an Intern Get yourself a free intern. There is an entire group of people out there who are looking to get their feet wet in order to find out what its like to do what you do. Write up a quick ad about what you are looking for, what your company is all about and why it would be a great experience for someone to work side-by- side with you for a couple hours a week. This has to be a win/win for both you and the intern, so spend some time thinking about what this person could learn from you. There is a site called www.monstertrak.com. This is a site where open positions are advertised to college students. There is an entire section just for interns. Rates to post ads are very reasonable. Check it out.

Exerted from Easy Delegation for Entrepreneurs, You Have the Power Are You Using It? Want your own copy of this step-by-step guide to building and managing a team? Visit www.processprodigy.com/sponsorship.

C 2005 Beth Schneider. Want to reprint this article, feel free as long as you include the following: Beth Schneider, Chief Infopreneur of Process Prodigy, is a business process consultant who helps solo-entrepreneurs, small business owners and network marketers who want to systemize their business to increase profits, increase productivity and grow their business without having to give up the family oriented, flexible, balanced lifestyle they desire. Beth works one-on-one with her clients, offers home study courses, and teleclass boot camps. For more information visit www.processprodigy.com and sign up for your FR*EE 5-Step Process Starter Kit and FR*EE Process Tips.

Number one: don't stop reading. Too many investors see these common failures and simply brush past them, thinking "How could I possibly fall into the category of the average investor? I'm smarter than all of this; I can't be subject to these kinds of mistakes..."

...WRONG

More investments go sour from these different 'mistakes' than any other obstacle you'll face in your investing career. So please, do yourself a favor and keep reading. And keep an open mind too.

Number two is fear. There are two ends to the spectrum here so you have to find a middle ground. The most common is being afraid of cutting your losses. Don't stay in simply hoping it will get better, or you'll dig yourself a much deeper hole. What's worse is being afraid to make any mistakes at all. This has kept many of us from jumping into a sound investment. Just keep in mind that you won't be able to win if you're not even playing the game.

The second half of this is not fearing anything. Having that little voice of reason in your head can keep you from throwing away a lot of money. If this sounds like you, you're cure is risk management. Take the necessary precautions to set explicit limits as to when you get out of any investment, no matter the outcome. Follow the rules you set for yourself to keep your investing safe.

Next on the list: ignorance. I can't believe how eager people are to jump into the system and try to start making money without learning the game. You need to have a passion for learning everything in the market. By studying what you're up against and becoming knowledgeable about what you're doing specifically you'll have a far greater advantage than any other trader.

The big step: figure out what you do and don't know. It's harder than it sounds but by doing so you'll give yourself an honest approach to making yourself better.

Finally we come down to an investor's greatest enemy: greed. People are gullible...YOU are gullible. Too many people get sucked into the "miracle investment" that promises the amazing returns while hiding the major risks. Do your homework. If you take care of your professional ignorance above, greed should never get the best of you.

It's your money we're talking about here. You should be able to look at each investment objectively to ensure your financial safety. Armed with these easy techniques you'll be able to become a major player in the world of investing in no time.

Joe Harris provides all the proven stock market investing tools you need to succeed today, including investments in the gold market. For details visit his site:Stock Investing

The 80 20 rule was not devised for Forex trading - however if you apply it in your trading, you'll instantly increase your profit potential. The rule is simple to understand and apply - and all Forex traders should use it.

So, what is the 80 20 rule, and why is it so powerful in terms of making Forex profits?

The Logic of the 80 20 Rule

In the nineteenth century, Vilfredo Pareto, an Italian philosopher, observed that a small section of the population held most of the money and power. He postulated that in most countries, 80% of the money and power was controlled by around 20% of the people. Therefore, 20% of the participants accounted for 80% of the results.

The 80 20 rule applies to many other areas of life - including Forex trading, and in simple terms, the key point to consider is this:

80% of your results will be generated by 20% of your efforts.

This also means that:

20% of your results will be generated by 80% of your efforts.

In Forex trading, its a fact that most traders make this critical error they trade too much - and try to force results by working too hard.

Heres what you need to do, to apply the 80 20 rule in Forex trading, and increase your results:

1. Cut out short term trading - like Forex day trading. In day trading, you trade frequently - but it simply doesnt work. This is because all short-term volatility is random - and you can never get the odds in your favor.

2. Only trade significant technical patterns - such as critical breaks of support and resistance, with your Forex trading system.

3. Risk more per trade on the good trades - up to 20% is OK. Remember, risk goes with reward - and you need to take meaningful calculated risks, when the odds are in your favor.

In terms of your Forex trading strategy: Focusing on the above will make you more money but youll also reduce the effort you put in.

Shift your emphasis to long term trading - and only trade the best signals. By doing this, your workload - and the amount of time you need to spend on your Forex analysis will be reduced.

If you apply the 80 20 rule to your Forex trading in the above way, youll cut the effort you put in. Youll also increase the profits you make - and thats what all Forex traders want!

Cutting the Effort You Put In and Getting Bigger Rewards

Many people think that the more effort you put in, the better the results you obtain. This is true in many areas of life - but not Forex trading! Here you are paid for being right with your Forex trading signals - thats all.

Also, dont fall for the myth that the more you trade, the better your chance is of having Forex trading success. This is simply not true - because the big trades, with the best ratio of risk to reward dont come around that often.

The 80:20 rules applies in many spheres of life and if you know what it is and apply it in forex trading you will increase your profits dramatically. So lets take a look at what it is and specifically how to apply it to forex trading.

In the late nineteenth century an Italian economist named Vilfredo Pareto observed that, in his native country of Italy, a small group of people held nearly all the power, influence, and wealth.

Came to the conclusion that in most countries, about 80% of the wealth and power was controlled by about 20% of the population and he referred to this as:

Predictable imbalance, which became known as the 80:20 rule.

He concluded that in relation to an individuals effort:

20% of your effort or energy output will produce 80% of your income furthermore, 20% of your time will produce 80% of your work out put or income.

Does this apply to forex trading?

Yes it does and the lesson you can learn from the 80:20 rule is to work smart not hard. Concentrate your effort on the trades that have the best risk reward.

Cut The Number Of Trades You Do

Its a fact that most traders trade too much and execute trading signals to often, as they want to force the market to give profits, but of course profits cannot be forced.

The way to apply the 80:20 rule to currency trading is drop your frequency of trading. If you look at forex charts you will see that there are very few big trends each year but when they do occur they produce huge profits.

How do you spot them?

Here is a checklist

1. Look for valid resistance levels, that if broken are considered significant by the market.

2. Learn how to use a breakout methodology and go with breaks of these support and resistance levels.

3. To increase the odds even further make sure that you use momentum indicators to confirm that price momentum is supporting a break.

4. As you are trading less you can afford to risk more on these trades and increase profitability.

5. Dont trail stops to close and have a profit target that relates to the size of the break.

The above method will ensure you are trading a lot less and it could be as much as 80%, but your profitability will be increased.

Its a fact that most of the big profits are generated from trades that break from new market highs - NOT market lows.

So if you have been buying dips its time to re think your forex trading strategy.

Trading Less for More Profits

If you like excitement and the thrill of trading this strategy is not for you. The above strategy is all about making money and trading the trades with the best risk to reward which can yield triple digit annual gains.

If you have been trading and making marginal profits, apply the 80:20 rule to your trading, cut the frequency of trades and increase the profits!

Most traders think they can buy an e-book from a vendor and make money, but the fact is there is better FOREX education you can get and a lot of it for free!

Lets take a look at the best FOREX education.

First things first

Forget all the gurus and mentors offering you unlimited riches if you buy their e-books.

Most of this material is either free on the net or is based on suspect logic, which means it doesnt work.

If you buy advice make sure the vendor has real time track record of success.

That gets rid of 99% of systems and courses!

Keep in mind most of these vendors make money from selling systems not trading them.

FREE Essential material

If you are trading FOREX you should trade a technical method and everything you need to know is available about technical analysis free on the net.

You need to know about indicators so pick some you like to confirm chart moves. If you are looking we suggest these ones as essential:

The stochastic, RSI, moving averages and Bollinger Bands.

Then learn how breakout methodology works and base your system around this.

You can read about them on the net and look at them on free chart services such as futuresource.com

Its easy to build a system that works and we have shown you in other articles how to do this.

Great Value Material

If you are going to buy FOREX education make sure you buy from people who have made money and there are some great books available that cost very little in your local bookstore or online.

Here are some good ones to look at.

Victor Sperandeo Trader Vic

Simply our favourite book.

Easy to read and packed with insight on everything from money management to trading a system. A true trading legend.

Jacob Bernstein

One of the great writers in our view on the psychology of trading markets.

Really gets into the mindset of successful traders and his books are always a very good read.

Market Wizards & The New Market Wizards Jack Schwager

These books interviewed a wide range of traders who can be considered legends.

Although they all trade differently they all have certain things in common.

This is a very inspiring and is packed with great insight into what makes a great trader.

Buy these books!

There are other books of course, but we like these, as there not only packed with great trading knowledge, there also easy to understand and fun to read.

You will be able to pick up these books for under $100 or so and there far better value than 99% of e-books sold and will give you a far better FOREX education.

Keep it simple

So get your system together from free material and then refine it with the above great books and you will be all set to approach FOREX trading with confidence and get on the road to consistent profits.

There has been a plethora of new financial instruments coming on stream for individuals in recent years. A few provide more leverage than just buying and selling stocks. Among the most rewarding markets opening up to traders is the FOREX (Foreign Exchange Market).

Why? Money or currency is the ultimate commodity. Every time a company or government buys or sells products and services in a foreign country, they are subject to a foreign currency trade, the exchanging of one currency for another. May individuals and organizations also trade currencies for speculative purposes. In contrast to the worlds stock markets, foreign exchange (Forex) is traded without the constraints of a central physical exchange.

Transactions are instead conducted via telephone or online networks. With this transaction structure in place, the Foreign Exchange market has become by far the largest marketplace in the world. With all these currency transactions going on daily, it is no wonder that the foreign currency exchange market (known as Forex or FX market) is the largest financial market in the world. It is much bigger than all the US Stock markets combined with a daily trading volume larger than that of all the worlds stock markets put together!

In addition, it is the least regulated market providing the greatest liquidity to investors. Trillions of dollars of foreign exchange activity takes place very day. From 1997 to 2000, daily Forex trading volume surged from US$5 billion to US$20Trlllion. The Forex market continues to grow at a phenomenal rate. This high volume is advantageous from trading standpoint because transactions can be executed quickly (with minimal slippage) and with low transaction costs. (Small bid/ask spread).

Before the Internet, only corporations and wealthy individuals could trade currencies in the Forex market through the use of proprietary trading systems of banks, often through private banking.

These systems required about $1Million to open an account. Thanks to the proliferation of the internet, today self directed investors with only a few thousand dollars and smaller financial firms can have access to the forex market 24 hours a day with the same liquidity as larger market participants.

For traders, Forex trading provides an alternative to the stock market trading. Whilst there are thousands of stocks to choose from, there are only a few major currencies to trade (Dollar, Yen, British Pound, Swiss franc and the Euro are the most popular). Forex trading also provides a lot more leverage than stock trading and the minimum investment to get started is a low lower. In addition, you have the ability to choose flexible trading hours (Forex trading goes on 24 hours a day!) and lower margin requirements.

As a result, foreign exchange trading has long been recognized as a staple and superior investment vehicle by central banks, major banks, multinational corporations (MNC), individual investors and speculators, institutional funds and hedge funds.

Trading or speculation makes up 95% of the daily volume. The other 5% of daily volume consists of governments and commercial companies converting one currency into another from buying and selling goods and services. The other 5% of daily volume consists of governments and commercial companies converting one currency into another from buying and selling goods and services.

More individual traders are jumping on this Forex Market bandwagon as it opens up opportunities to trade a global market on a flexible schedule and low barrier of entry.

Tuesday, August 28, 2007

I had a discussion recently with one of my newsletter subscribers. He brought up the topic of forex and made the inquiry "isn't that mainly a professional market?", which is something I've heard a great many times.

Certainly forex used to be pretty much exclusively the domain of the pros. It was very difficult for the individual trader to play that market. Starting in the late 1990s, though, that began to change. Individual trading accounts become more readily available. Since then there has been an explosion in forex brokers

The great thing about that development is its impact on part-time traders. Forex is a fantastic part-time trading market. It operates 24-hours, so one can trade at any time of day or night. That literally means you can day trade at any time of day, if such is your interest. You arent redistricted to standard daytime market hours, which dont work for many people.

There are low account minimum sizes available in so-called retail forex trading, and even a no minimum account in at least one case. There are also low (or no) minimum transaction sizes available. Plus, there are mostly no commissions (or at least only very small ones) for forex trading.

I actually consider forex trading to be much easier to manage for the part-time trader than the stock market. Think about how many stocks there are available to trade. It's a huge amount. In forex there are fewer legitimate tradable "instruments", though they provide at least as much opportunity for trading part-time.

Furthermore, forex trading can be a lot less demanding in terms of the analysis required to make trading decisions. Part-time trading, after all, is about managing the trade decision-making process as quickly and efficiently as possible. That's something more easily done in forex than in some other markets, like stocks.

So dont let anyone tell you that forex trading is only for the pros. If you have an interest in trading the comparative rates of exchange between the worlds currencies, there are plenty of opportunities for you to do that. You dont need to have millions in your account.

John Forman is author of The Essentials of Trading (Wiley - April 2006), and a near 20 year veteran of trading and analyzing the markets. For more information on forex trading, check out John's free forex guide which will answer your questions about the currency market.

The most common reason people are not making the kind of money they want to make with their Internet business is a lack of focus. These are people who have too many sites and dont spend any time focusing on ONE business. They may have 20 or 30 websites, with each site only breaking even or making a few hundred dollars every month. Most of these people are what I call "opportunity seekers."

Most opportunity seekers are making a common mistake of having too many sites and too many interests. This prevents them from focusing their efforts and creating the six figure income they dream of.

Focus Is The Key To Long-Term Success

If you want to succeed on the Internet, you are much better-off staying focused. That means starting off with one site or idea and perfecting it before moving on to the next Internet adventure. Almost all opportunity seekers have a "get rich quick" mind-set. They jump from one program to another hoping one of them will lead to success.

Opportunity seekers are always the first to jump on the next "big" moneymaking bandwagon without considering their true talents, abilities and interests. It may be one thing one month, another the next month. They may try to concentrate on affiliate marketing then switch dramatically to e-book marketing the next.

These people are looking for some easy way to make money. This is NOT how an entrepreneur thinks! However, this is exactly how an opportunity seeker thinks. They always are looking for shortcuts, and then wonder why it isnt working.

It isnt working because they have no focus. Focus is one of the most vital aspects of success. My advice to these newbies is shut down 29 of your sites and focus on one site, the one that best represents your interests. Work on refining and optimizing it. Refine your sales process and your back end on this single site and make it successful BEFORE you move on to the next site.

A business with depth and focus is better than a business that has many sites in many different niches. This means that if you have a product in a particular niche, like stock trading, focus on selling products related to that and that only. This way youll have one group of customers and you can become a big fish in a small pond.

The problem with a business with too many niches is that you are not specialized. It is almost impossible to make a six-figure income with this kind of business because you dont spend enough time on any ONE business.

Think Like An Entrepreneur

So, the biggest problem people have is they are opportunity seekers. The key is thinking like a true Internet entrepreneur. Dont jump on the trend bandwagon. Dont ask what the shortcuts are. An entrepreneur has a long-term vision. You have to have a one-year, five year and ten year vision. Find out what you want your business to look like in the long-term and ask yourself what do you want to accomplish ultimately. Then decide whether your activities fit with your goals. Stop jumping from one program to another. Focus on one program, one site and one great idea. This is what you have to do if you want to make six figures. It has nothing to do with your knowledge, skill sets, experience etc. It has to do more with your focus.

Once you are an expert in your industry or niche, THEN you can think about diversifying your business.

Copyright James Lau Do you know why a lawyer would give up his career to be an internet entrepreneur? To find out, go to www.internetbizmodels.com

James Lau had been working as an engineer for a number of years prior to discovering the power of internet marketing way back in 2001. He is now a full time internet marketer running his own low-cost, high-profit internet businesses specializing in Resell Rights business.